Nebraska is another of the many states in the US where both non-judicial and judicial foreclosures are allowed. With judicial foreclosures the lender is compelled to foreclose through the auspices of the courts. A power of sale is allowed to be conferred upon a trustee and in this instance a non-judicial foreclosure is allowed to take place. Power of sale foreclosure is required to follow strict requirements in terms of notice processing, advertising and time frames.
The primary instrument of security is the Mortgage Lien and the Title Deed however Nebraska is primarily a title theory state. Unlike many other title theory states the foreclosure process takes quite a long time to complete, the most typical timeline is approximately 90 - 120 days for an uncontested non-judicial case. In the case of a judicial foreclosure this may take as long as 6 months and borrowers are often able to delay a sale for as long as 9 months, even longer if a bankruptcy is sought or the case is contested by the borrower.
There are no statutory rights of redemption for the borrower once the sale of the property has taken place. However during the foreclosure process if the borrower is able to cure the default, the foreclosure can be stopped. The borrower will also have to pay all due taxes, court costs and interest, and minor lien holders will also be seeking the debts owed to them.
Deficiency judgments are available to provide the lender with legal recourse to recover any outstanding amounts on the debt. In essence this means if the property is sold for less than the underlying loan amount. The lender is required to pursue deficiency judgments within 90 days of the sale and is limited to the debt, costs and fees less the fair market value of the property.